Mass General Brigham Reports Third Quarter 2024 Financial Results

Mass General Brigham, a not-for-profit, integrated healthcare system, today reported income from operations of $47 million (0.9% operating margin) for the third quarter of fiscal year 2024, which ended on June 30, 2024. In the third quarter of fiscal year 2023, the health system reported income from operations of $69 million (1.4% operating margin).

“Despite pressures that continue to confront Mass General Brigham and other health systems, we are investing in our mission of patient care, research, education, and support for the community around us. At the same time, we are supporting our people and evolving our organization for the future, so we can provide seamless care for our patients and communities, while enhancing collaboration to drive new discoveries and educate the next generation of healthcare professionals,” said Anne Klibanski, MD, President and CEO of Mass General Brigham. “Our ongoing work to ensure financial stability and access to high-quality affordable care will enable our long-term efforts to build a more impactful, patient-focused, and equitable health system with the highest quality research-infused care that improves outcomes and experiences for all we serve.”

The system recognized total operating revenue of $5.2 billion in the third quarter of fiscal year 2024, an increase of $326 million (7%) over the 2023 third quarter. Patient care revenue grew to $3.4 billion, an increase of $161 million (5%). Ongoing efforts to coordinate systemwide capacity management resulted in an average acute care inpatient length of stay of 5.9 days, a slight decline from the comparable prior year period (-0.3%), and contributed to growth in discharges (3%).

The system also recognized $563 million in health plan premium revenue (9% increase), $732 million in research and academic revenue (4% increase) and $521 million in other revenue (21% increase).

Operating expenses totaled $5.2 billion, an increase of $348 million (7%) over the 2023 third quarter, reflecting increases in medical claims ($31 million or 9%), wages and benefits ($129 million or 5%), and costs and use of pharmaceutical ($81 million or 20%) and other clinical ($19 million or 7%) supplies.

“We are making progress in our work to reduce our expense growth trend, to ensure our organization is well-positioned to deliver on our mission for years to come,” said Niyum Gandhi, Chief Financial Officer and Treasurer at Mass General Brigham. “Our ongoing work to promote responsible resource stewardship and diversify our revenue sources will enable continued investment in our mission-driven work to improve patient outcomes and support the health of our communities.”

The system reported an overall gain of $277 million for the three months ended June 30, 2024, including a nonoperating gain of $230 million. Nonoperating activity includes gains and losses on investments and interest rate swaps, which can vary significantly year to year due to volatility in the financial markets, and philanthropic activity. In the comparable prior year period, the system reported an overall gain of $437 million, including a nonoperating gain of $368 million.

Year-to-date financial results

Excluding onetime revenue totaling $118 million relating to prior year healthcare provider activity, the system generated operating income of $41 million (0.3% operating margin) for the nine months ending June 30, 2024. Inclusive of onetime revenue, the system reported income from operations of $159 million.

In the comparable prior year period, the system generated an operating loss of $5 million (0.0% operating margin). This excludes $67 million in healthcare provider revenue related to prior year activity related to federal transfers connected to the COVID-19 pandemic. Inclusive of onetime revenue, the system reported income from operations of $62 million.

For the nine months ended June 30, 2024, the system absorbed $1.8 billion in Medicare, Medicaid, and Health Safety Net shortfalls due to certain government reimbursements that do not cover the full cost of providing care to Medicare, low-income, and uninsured patients, consistent with the shortfall absorbed in the comparable prior year period.

The system reported an overall gain of $1.7 billion for the nine months ended June 30, 2024, including a nonoperating gain of $1.5 billion. In the comparable 2023 nine-month period the system reported an overall gain of $1.3 billion, including a nonoperating gain of $1.2 billion.

Making an impact for the patients and communities we serve

Mass General Brigham continues to make investments that support its four-part mission, focusing on initiatives that improve patient outcomes, drive breakthrough research, make care more affordable, and build healthier neighborhoods in the communities it serves.

• A sustained focus on high-quality care: Five Mass General Brigham hospitals were once again named among the top hospitals in the nation by S. News & World Report, with Massachusetts General Hospital and Brigham and Women’s Hospital earning spots on the “Best Hospitals” honor roll, and multiple hospitals earning top rankings in key specialties like psychiatry, OB-GYN, rehabilitation, and ophthalmology. Through its For Every Patient strategy, Mass General Brigham is driving a long-term, sustained focus on high-quality care across its member organizations, prioritizing initiatives that ensure safe, effective, equitable care with the best experience possible. This single quality strategy is supported by a unified structure that is driving this work across the organization, through a rigorous, data-driven approach focused on external benchmarks and measurable results.

• Evolving our organization for the future: To build the most impactful, patient-focused and equitable academic healthcare system in the world, Mass General Brigham is evolving its organization to operate seamlessly in service of its patients, people, and communities. In March, the system announced plans to unify the clinical departments and academic programs at Massachusetts General Hospital and Brigham and Women’s Hospital, and to build disease-focused, interdisciplinary institutes. This work is well underway, with systemwide and department leaders working together to establish a vision and plans for unified departments, and comprehensive planning underway to establish disease-focused institutes. This work is enabled by an ongoing effort to improve the clinician experience, driven by a process where clinicians design solutions aimed at improving wellbeing.

• Developing a system-wide cancer strategy: For the past several months, physicians, researchers, nurses, staff and other stakeholders from across Mass General Brigham have been working together to develop a single strategy to meet the future of cancer care, research, and education. This strategy is designed to extend the frontier for research-driven excellence in cancer care for all in the community we serve, over the entirety of a patient’s lifetime and needs, by extending the horizon of scientific discovery and innovation. In the coming months, Mass General Brigham Cancer will be developed through an operational planning process led by system leaders and systemwide cancer clinical leadership: David Ryan, MD, physician-in-chief; Gerard Doherty, MD, surgeon-in-chief; and Daphne Haas-Kogan, MD, radiation-oncologist-in-chief.

• Investing in housing and behavioral health: Though its unified community health strategy, Mass General Brigham is targeting investments that address key social determinants of health that represent the biggest drivers of inequities. Last month, Mass General Brigham leaders joined state and local officials to announce the awarding of $18 million in Community Health Impact Funds to 22 local organizations to support affordable housing initiatives throughout Greater Boston. This announcement builds on $4.5 million in Community Impact Funds announced earlier this year by Brigham and Women’s Faulkner Hospital to support behavioral health initiatives in Hyde Park, Jamaica Plan, Roslindale, and West Roxbury.

• Research drives insights in effective care models: Mass General Brigham’s world-class research enterprise is driving new insights into the most effective ways to care for patients. A new study by Mass General Brigham researchers assessed the outcomes of nearly 6,000 Americans nationwide who received care for a serious medical condition in their home instead of at a hospital. Their findings validated the safety and effectiveness of receiving sudden, or acute, care at home. These findings support the value of the system’s focus on expanding its Home Hospital service to bring high-quality care to patients in the comfort of their homes.

• Advancing AI in medicine: Mass General Brigham continues to pioneer the use of artificial intelligence to improve healthcare. Last month, the system announced a new collaboration with Microsoft to accelerate solving some of the biggest challenges in radiology and further advance AI in medical imaging to drive clinician efficiency and enable better health outcomes. The collaborations will foster research and innovation tied to the advancement of high-performing multimodal AI foundation models that empower the radiology ecosystem. This new collaboration comes as Mass General Brigham investigators continue to assess the use of generative artificial intelligence for clinical applications, with several new studies comparing the clinical reasoning abilities of large language models (LLMs) to those of physicians.